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12 4.5 pts R. S. Green is a chain of furniture retail stores. Morris Industries is a furniture maker and a supplier to R. S.

12 4.5 pts R. S. Green is a chain of furniture retail stores. Morris Industries is a furniture maker and a supplier to R. S. Green. R. S. Green has a beta of 1.36 as compared to Morris Industries' beta of 1.07. The risk-free rate of return is 3.9 percent and the market risk premium is 8 percent. Both firms are all equity financed. What discount rate should R. S. Green use if it considers a project that involves the manufacturing of furniture? Question 15 4.5 pts Cookie Dough Manufacturing has 250,000 shares of common stock outstanding at a market price of $28 a share. Next year's annual dividend is expected to be $1.54 a share. The dividend growth rate is 4 percent. The firm also has 7,000 bonds outstanding with a face value of $1,000 per bond. The bonds carry a 8 percent coupon, pay interest annually, and mature in 7.5 years. The bonds are selling at face value. The company's tax rate is 27 percent. What is the firm's weighted average cost of capital

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